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Address, opening factory extensions of Leeton Citrus Juices PTY Limited

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/ I STATEMENT BY . V j / | THE MINISTER FOR l _ / ;4 p r i m a r y i n d u s t r y Λχ 1 THE RT· HON. IAN SINCLAIR Ml’p



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10 March 1978.


It is a pleasure for me to be invited to open the new offices and

factory extensions of Leeton Citrus Juices, the local processing

firm which, in five years of operation, has become a major marketing

force in Australia's fruit juice industry.

Formed by a group of Leeton district growers in 1973 to market

direct to consumers, the company today represents an investment of,

some $1.5 million in plant employing 4 0 people.

The present.extensions demonstrate confidence in the future of.the

Australian citrus industry and .an increasing domestic demand for.

citrus juices. ·

That confidence is not misplaced.

Citrus growing and processing is an extremely important industry in

Australia. . . . .

With production generally increasing by some 5 percent a year, the

gross value this year is expected to top $70 million - an increase

of some 15 percent over last season. ' .

However, rising costs together with relatively low world orange

juice prices and markedly increased.imports to Australia in recent

years have heightened economic pressures on citrus producers.

Grovers' returns have been a£fected by competition from imports as

well _as by .'.changes in production and in domestic demand.

. ../.!■

So far this year duty paid import prices for orange juice have been

substantially higher than in previous years as a result of poor

seasonal conditions in Florida and Brazil and the.application of a

65 percent ad valorem duty on imports. ■ ■ .

However, this situation cannot be expected to continue for more than

a year or two at most. . -

If as the Bureau of Agricultural Economics predicts, current high

world .prices abate increased pressure from imports will again be

applied to the local industry. ■■■·-.

In tha t case the report of the present Industries Assistance Commission

inquiry into the long term assistance needs of the citrus industry is

significant. \

Publication of the I.A.C. draft report is expected shortly, following

which further public hearings will be held and a final report

submitted to the Government. ,

On the latest information available to me I would expect Government

decision on the Commission1s recommendations within a few months.

You will recall that Australian citrus growers expressed considerable

concern over a number of years at the level of imports of orange

juice entering Australia.

Substantially increased juice imports coincided with a deterioration

in the competitive position of the Australian industry following the

Labor Government's 25 percent tariff cut in 19 73/7 4. and rapidly rising

production costs.

For a time the producing, processing and marketing sectors of the

industry responded to the import threat by voluntarily restraining ■

intake. But late in 1975/76 competitive pressures finally made the

restraints ineffective. ■ . ■ . .

The question of competition from cheap imported, orange juice was

referred to the Temporary Assistance Authority in 1976, whose '

recommendation of a tariff quota of 28.3 million litres single strength

of orange juice was applied in 1976/77 season. . .

. . ./3


0 The Industries Assistance Commission was then asked to examine the

question of future assistance to the industry. On its interim report

last year the Government imposed a 65 percent ad valorem duty on orange

juice imports for the year ending 30 June 1978. ' . .

Citrus growers in the Leeton-Griffith area, responsible for about

one sixth of total Australian production, have received generally

good prices for oranges delivered .for processing this season.

Increasing consumption of citrus juice in Australia has helped to

clear the surpluses of orange juice which so concerned the industry

in" recent years. . - ' ■

However, problems of surpluses still apply to the production of

lemonsiand grapefruit. It has not been possible to find sufficient

outlets for grapefruit in either of the, last two seasons, and

fruit has been allowed to fall from the trees. .

Heavy supplies of cheaper grapefruit juice are available on the world

market, and this situation is expected to continue for some time.

Here in the Murrumbridgee Irrigation Area the operation of six large

processing plants - - including Leeton Citrus Juices Pty Limited - -

serves to protect growers from the adverse effect of these difficulties

The Leeton Citrus Juice company has in fact doubled its sales volume

each year to markets in Central, Western and Southern New South Wales

as well as the Sydney Metropolitan area.

The company is currently gearing up to introduce a new juice product - -

long life concentrated orange juice -- which can be stored without

refrigeration. . . . ‘ , ·

The new product will be packed by the Dairy Farmer Co-operative in ‘

Sydney, using a new ultra high temperature processing unit. ■ I

I understand that if full market potential . is realised, the company

expects to almost double its present intake of fruit in coming years.

. . ./4

This type of innovative product development and marketing will

help to ensure the viability of the Australian citrus industry in

the future. ' . . .

•My congratulations to *s management and staff. I now

have pleasure in declaring the new office building and factory

extensions of Leeton Citrus Juices Pty Limited open..